Discuss the below:
Q: A manager of an oil refinery has 8 million barrels of crude oil A and 5 million barrels of crude oil B allocated for production during the coming month. These resources can be used to make either gasoline, which sells for $38 per barrel, or home heating oil, which sells for $99 per barrel. There are three production processes with the characteristics in table 1. All quantities in the table are in barrels. For example, with the first process, 3 barrels of crude A and 5 barrels of crude B are used to produce 4 barrels of gasoline and 3 barrels of heating oil. The costs in this table refer to variable and allocated overhead costs, and there are no separate cost items for the cost of the crudes. Formulate (and solve with AMPL) a linear programming problem that would help the manager maximize net revenue over the next month.
Process 1 Process 2 Process 3
Input Crude A 3 1 5
Input Crude B 5 1 3
Output Gasoline 4 1 3
Output heating oil 3 1 4
Cost $51 $11 $40